Introduction

The General Services Administration (GSA), which oversees the management of government buildings, has recently announced a significant nuclear energy contract. This development comes on the heels of several major tech companies making substantial investments in nuclear energy over the past year.

The Contract Details

The 10-year, $840 million contract is for 10 million megawatt-hours (MWh) of electricity, which translates to what’s needed for more than 1 million homes annually. The GSA has awarded the contract to Constellation, which operates the nation’s largest nuclear fleet and has recently announced an agreement with Microsoft to restart a nuclear reactor at Three Mile Island.

Nuclear energy accounts for approximately 4 million MWh of the total, according to Constellation spokesperson Paul Adams. This marked shift towards nuclear energy is a significant development in the industry.

The Significance of Nuclear Energy

Silicon Valley’s increasing reliance on nuclear energy is largely driven by the growing demand for electricity from AI data centers. The federal government is the nation’s single largest energy consumer, making this contract a crucial boost to the nuclear industry.

"We are thrilled to partner with Constellation to deliver reliable and cost-competitive nuclear energy to our customers," said GSA administrator Robin Carnahan in a press release. "This historic procurement locks in a cost-competitive, reliable supply of nuclear energy."

The Benefits of Nuclear Energy

Nuclear energy generates 10 percent of the nation’s carbon pollution-free energy, with a majority coming from nuclear power plants. Constellation also produces hydro, wind, and solar power, as well as electricity from gas-fired power plants.

However, the company has set a goal of reaching 100 percent carbon-free electricity by 2040, up from close to 90 percent today. The contract will allow Constellation to extend licenses for existing nuclear power plants and invest in new equipment and technology that should result in 135 megawatts (MW) of additional capacity.

Government Support for Nuclear Energy

The GSA’s announcement is part of a broader trend towards increased government support for nuclear energy. Last year, several major tech companies, including Google, Meta, Amazon, and Microsoft, inked significant nuclear energy deals.

Microsoft and Constellation recently announced plans to restart a shuttered reactor at Three Mile Island in Pennsylvania, the site of the worst nuclear accident in US history. The Biden administration has also made nuclear energy a key component of its plan to transition the US away from fossil fuels and towards clean energy sources that don’t cause climate change.

The Future of Nuclear Energy

The GSA’s contract is seen as a way to lock in more affordable prices for government agencies, which are facing increasing competition for limited clean energy sources. In the face of uncertainty over future electricity prices and growing demand from data centers and AI facilities, this contract provides federal agencies with budgetary stability and protections from future price increases.

Conclusion

The GSA’s announcement marks a significant shift towards increased investment in nuclear energy. With several major tech companies and government agencies already on board, it seems that the tide is turning in favor of nuclear energy as a reliable and clean source of electricity.

Government Agencies Involved

The contract will extend to 13 other federal agencies, including:

• Departments of Veterans Affairs and Transportation
• Federal Bureau of Prisons
• National Park Service
• Social Security Administration
• US Mint

Sources

• [1] Constellation press release
• [2] GSA press release
• [3] Microsoft press release
• [4] Department of Energy press release